Nvidia’s stock price rose 4.5% in the final half hour of trading on Friday, despite no obvious catalyst for the move. The rebound comes as the stock market recovers from a difficult week, and Nvidia is benefiting from a positive update from one of its suppliers.
Foxconn, a Taiwan-based company also known as Hon Hai Precision Industry, reported fourth-quarter net income of $1.41 billion, which missed analyst estimates by 13%. However, Foxconn’s management expressed confidence in the demand for its AI server business, expecting it to more than double in the first quarter of 2024.
Chairman Young Liu said that CSP (cloud service provider) demand is not slowing down, contradicting market rumors. He also stated that AI server revenue will make up over half of Foxconn’s total server revenue by 2025 and plans to increase production for Nvidia.
While there are still uncertainties surrounding the trade war and export controls, Nvidia’s stock trades at a more attractive valuation than in the past, with a forward earnings multiple of around 27 times. However, investors should consider that The Motley Fool Stock Advisor analyst team did not include Nvidia on their list of top stocks to buy now.
Investors can check the latest top 10 list from The Motley Fool Stock Advisor service, which has more than quadrupled the return of S&P 500 since 2002.
Source: https://www.nasdaq.com/articles/why-shares-nvidia-are-rising-end-week